Corning and the incentives game

Corning and the incentives game

Corning and the incentives game2016-10-262016-10-26http://businessnc.com/wp-content/uploads/2018/05/bncweblogoblacksmall_space-01.pngBusiness North Carolinahttp://businessnc.com/wp-content/uploads/2016/10/Timmerman_copper-gate-1100-px.jpg200px200px

Conover small-business owner Dan Timmerman’s business and political spheres mirror some of the most powerful economic trends sweeping North Carolina. His personal story exemplifies the diverging track of big corporations and metro areas with Main Street companies in more rural parts.

Timmerman’s family business opened in 1962, mostly forging metal pieces used in furniture made in Hickory, Morganton and High Point. By the mid-1970s he had as many as 110 employees, benefiting from the industry’s peak years. By the 1980s, many furniture makers were cutting jobs, moving operations to lower-cost foreign markets, or closing.

Timmerman

“We almost went out of business when the industry moved to China,” he says. “NAFTA also took a lot of jobs, including GE and other companies, away from our area. But you just have to deal with it. We had two choices: evolve or dissolve.”

Timmerman Manufacturing Inc. shifted to making wrought-iron products, including tables, chairs, railings and gates. Entrances of many exclusive subdivisions and homes in the Lake Norman area sport the company’s offerings. It now employs 25 people and its website notes, “We do not import.” Prospects look solid, at least until the next housing downturn.

That’s Timmerman’s day job. He also is chairman of the Catawba County Economic Development Commission. In September the group faced a choice: Provide $1 million in incentives for Corning Inc. to invest $30 million and add 105 jobs — average pay of about $58,000 — at its Hickory cable-fiber plant, or risk losing those jobs to another community? Sounds easy, except one obvious concern: Corning earlier this year said it would move its 400-employee optical-products division headquarters from Hickory to a north Charlotte suburb. Those white-collar jobs average about $90,000 a year; Corning said it could better attract talent to the Queen City than Hickory, and it would be closer to Charlotte-Douglas International Airport.

It hurts any town to lose 400 jobs. For Hickory, which has sputtered economically for a decade, the loss of 400 high-paying jobs is a major blow in terms of taxes, schools and community leadership. The area has 5% fewer employed than in 2006; Charlotte is up 24%.

Yet state and local agencies offered Corning $2.5 million to help move those jobs from Hickory to Huntersville, about 45 miles away. The state is also offering $1.9 million as Corning expands in Hickory and Winston-Salem. The latter expansion involves 100 jobs and $83.5 million in investment.

Corning, which has a stock-market value of $24 billion, is a philanthropic, progressive company. It has six major plants in North Carolina. And it knows how to work the incentives racket with gusto.

“The reality is they could have gone[ into South Carolina],” says Scott Millar, president of the Catawba development group. “I know they talked to them, and they could have gotten a pretty significant paycheck.”

Corning also considered investing in Mexico rather than expanding in Hickory and Winston-Salem, Millar says. “We are being impacted by the headquarters move, but we want [the company] to be strong and growing.”

Corning may eventually employ as many as 1,300 at the Mecklenburg site, developer Sam Simpson said at a real-estate conference in Charlotte this week. His Greensboro-based company, Simpson Commercial Real State, is teaming with Landmark Properties on the project. “They are moving here for the millennials,” he says.

Like most business owners lacking the influence of a massive corporation, Timmerman hasn’t ever received incentives. Holding their noses, he and the commission voted for the Corning payout.